REG - Distribution Finance - Full Year Trading Update

Distribution Finance Capital HoldingsAnnouncement

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RNS Number : 0354P  Distribution Finance Cap. Hldgs PLC  15 January 2026

This announcement contains inside information as stipulated under the UK
version of the Market Abuse Regulation (EU no. 596/2014) as it forms part of
UK law by virtue of the European Union (Withdrawal) Act 2018 (as amended from
time to time).

 

15 January 2026

Distribution Finance Capital Holdings plc

("DF Capital" or the "Company" together with its subsidiaries the "Group")

 

 

Full Year Trading Update & New Medium-Term Targets

 

Full year financial performance ahead of expectations with strong runway in
place underpinning new medium-term targets

 

Distribution Finance Capital Holdings plc, a specialist bank
providing financial solutions that support manufacturers, dealers and
distributors across the UK, is pleased to provide a trading update
for the year ended 31 December 2025 and to extend
its medium-term financial targets to 2030.

 

Full-year financial performance

 

 ·         The Group has seen strong momentum in lending throughout the year, which
           underpins record financial performance. This growth is driven by the Group's
           strong competitive advantages and increasing market share in resilient,
           well-understood and underserved market verticals.
 ·         Record new loan origination in excess of £1.8bn, up c.27% on prior year
           (FY2024: £1.4bn)
 ·         The Group's loan book exceeded a new high of £846m at the period end, up 27%
           on the prior year (FY2024: £666m) and ahead of previously guided range of
           £750m-£800m.
 ·         Stock days in the core inventory finance lending product, being the average
           age of loans outstanding, has reduced and remains well within sector
           tolerances at 129 days at the period end (31 December 2024: 140 days)
 ·         Portfolio quality remains strong and well within credit appetite. 39 dealers
           had arrears of more than one day past due and/or in legal recovery (30
           September 2025: 43), representing 2.7% of total dealers. Total arrears and
           loan balances in legal recovery represented 0.95% (30 September 2025: 1.5%) of
           the Group's entire loan book.  The breakdown is as follows:
           o  Dealers in early arrears (less than 30 days) totalled 2 cases, with
           aggregate arrears of £0.1m.

           o  Dealers in mid to late arrears (30 to 60 days) totalled 4 cases, with
           aggregate arrears of £0.5m.

           o  Dealers in default (>90 days past due), where balances are in legal
           recovery (i.e. non-performing loans(1)), totalled 33 cases (30 September 2025:
           31), with aggregate loan balances of £7.4m (30 September 2025: £10.4m),
           representing 0.9% of the Group's total loan book.
 ·         In light of this performance, the Group now expects FY performance ahead of
           market expectations, with:
           o  Statutory pre-tax profit for the year to be at least £19m and adjusted
           pre-tax profit of at least £17.5m(2), up 22% on prior year (FY2024 adjusted
           pre-tax profit: £14.4m)

           o  Tangible net assets per share(3) of at least 75 pence, up c.20% on prior
           year (31 December 2024: 63.8 pence)

 

Operational performance

 ·         Following the launch of the Group's new asset finance product, the Company now
           has c.120 dealers and introducers signed up and accepted to originate loans,
           predominantly in the motorhome and caravan sector.
 ·         Work is already underway, ahead of the spring sales season, to widen
           availability of the Group's consumer and business asset finance products to
           other core sectors in which the Group operates including holiday homes,
           business-critical assets and marine.
 ·         The Group has completed its annual lending customer satisfaction survey and
           has received a net promotor score of +59, up 21pts on prior year (FY2024:
           +38), reflecting the Group's commitment to long-term customer relationships
           and service quality.
 ·         The Group has taken part in the 'Great Place to Work' engagement survey,
           receiving 'excellent' ratings, the highest available, across all of the
           survey's employee satisfaction and engagement categories.

Medium-term targets

 

In addition to the Group's previously announced targets for 2028 which still
stand, having reached the 5(th) year of trading as a bank in September 2025,
the Group has completed its medium-term strategic and financial planning
through to 2030 and lays out the following targets for the financial year
ended 31 December 2030:

 

 ·         Loan book in excess of £1.5bn
 ·         Cost to income ratio in the range of 45%-48%
 ·         Return on required equity(4) of c.20%

 

The Group remains committed to support the sales and growth of manufacturers,
dealers and distributors and has built a suite of lending products and
services that underpin the vitality of the sectors in which it operates.

 

The Group expects to fund its medium-term growth targets through internally
generated capital, primarily via retained earnings, without the requirement of
a dilutive equity raise, growing tangible net assets by 10-15% per annum.
Accordingly, the Group expects to be holding excess capital through the
medium-term horizon, above acceptable buffers, which could enable an
acceleration of the Company's growth strategy as opportunities arise, enable
portfolio acquisitions, and/or returns of capital to shareholders by way of
share buyback or dividends. Subject to regulatory approval at the appropriate
time, the Board intends to initiate its first dividend following the year
ending 31 December 2028. Further details on the Group's dividend policy will
be communicated at the appropriate time.

The Group will provide more information on its medium-term targets and
strategy alongside the announcement of its audited results for the financial
year ended 31 December 2025, expected during March 2026.

Carl D'Ammassa, Chief Executive Officer, commented: "2025 has undoubtedly been
our best year so far. We have delivered growth and strong returns whilst also
launching our new asset finance product, built from the ground up. This new
product will allow us to further support our existing dealers, providing a
lending product for their customers. With our dealers having annual sales of
over £10bn, the market opportunity for us is significant and we expect this
product to be a key component of achieving our 2030 loan book target of over
£1.5bn.

 

"It has been humbling to reflect on our five-year journey as a bank,
generating four years of profit and a track record of delivery. As CEO it is
most pleasing to see the positive feedback from our customers and that our
products and services continue to resonate with them. I'm proud of the DF
Capital team's achievements and delighted that they see our Company as a great
place to work. I'm excited as we enter this next period, with all capabilities
that support our growth ambitions already in our armoury. I feel confident
about the Group's ability to deliver industry-leading returns underpinned by
an exceptional service and best-in-class team."

 

 1.  A loan that is in default (>90 days past due) going through formal recovery
     of our assets and/or unlikely to pay in full, where interest and fees are no
     longer accruing. Non-performing loans have appropriate credit loss provisions
     in place.
 2.  Pre-tax profit adjusted for the benefit of a VAT reclaim of approximately
     £1.5m.
 3.  TNAV per share is defined as net tangible assets attributable to each ordinary
     share (Group has shares in issue of 166, 726,333, excluding Treasury Shares).
 4.  Given the Group hold excess capital, Return on Required Equity is defined as
     minimum regulatory capital plus an appropriate buffer.

 

The person responsible for arranging the release of this announcement on
behalf of the Company is Karen D'Souza (Company Secretary).

 

For further information contact:

 

 Distribution Finance Capital Holdings plc
 Carl D'Ammassa - Chief Executive Officer                                  +44 (0) 161 413 3391
 Sameera Khaliq - Chief Financial Officer                                  +44 (0) 161 413 3391

 Kam Bansil - Head of Investor Relations                                   +44 (0) 7779 229508
 http://www.dfcapital-investors.com (http://www.dfcapital-investors.com/)

 Panmure Liberum Limited (Nomad and Broker)                                +44 (0) 203 100 2000
 Chris Clarke
 William King
 Gaya Bhatt

 Alma Strategic Communications                                             +44 (0) 203 405 0235
 Josh Royston
 Hilary Buchanan
 Hannah Campbell
 Sarah Peters

 

About DF Capital

DF Capital is a specialist independent bank providing award-winning commercial
finance solutions and savings products to consumers and small businesses.

Founded in 2016, the Group is headquartered in Manchester with over 130
people. DF Capital's commercial lending supports, distributors and
manufacturers across sectors including Automotive, Leisure and Luxury. In
2020, the Group became a fully authorised bank and started offering a range of
consumer savings products.

The Group is listed on AIM on the London Stock Exchange under the ticker DFCH.

For more information, please visit www.dfcapital.bank
(https://url.uk.m.mimecastprotect.com/s/mgSECpZ0NSnjqRWTDhPiGYrnj?domain=dfcapital.bank/)

 

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